Tariff classification and strict exemption construction determine treatment of mineral oils under the excise notification.

LABFS and LARO were treated as mineral oils classifiable under Heading 2710.29 because they satisfied the technical tariff description, even though they were not known as kerosene in common parlance. Exemption under Notification No. 75/84-CE was denied because exemption notifications must be construed strictly, and the term "kerosene" in that notification was read in its own context, linked to public distribution, rather than by importing the broader tariff meaning. The material therefore supported classification in favour of the assessee, but not the exemption claim, so relief was limited to classification.

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Issues: (i) Whether LABFS and LARO were classifiable under Heading 2710.29 of the Central Excise Tariff Act, 1985. (ii) Whether the products were entitled to exemption under Notification No. 75/84-CE.

Issue (i): Whether LABFS and LARO were classifiable under Heading 2710.29 of the Central Excise Tariff Act, 1985.

Analysis: The tariff description of Heading 2710.29 covered mineral oils answering the specified parameters, even if they were not known as kerosene in common parlance. The products manufactured by the appellant satisfied those characteristics, and the prior judicial view on classification of similar mineral oils supported their inclusion under the said heading.

Conclusion: The products were held classifiable under Heading 2710.29, in favour of the Assessee.

Issue (ii): Whether the products were entitled to exemption under Notification No. 75/84-CE.

Analysis: Exemption notifications are to be construed strictly, and their language cannot be expanded by importing the tariff definition of kerosene. The word "kerosene" in Notification No. 75/84-CE was understood in the context of distribution through the public distribution system, and the appellant's products were not cleared as such kerosene for that purpose. Accordingly, the condition for exemption was not satisfied.

Conclusion: The exemption under Notification No. 75/84-CE was denied, in favour of the Revenue.

Final Conclusion: The classification dispute succeeded for the appellant, but the claim to exemption failed, resulting in a partly allowed appeal with relief limited to classification.

Ratio Decidendi: A product may fall within a tariff heading by satisfying the technical description in the tariff, yet still be excluded from an exemption when the notification uses narrower language that must be construed strictly according to its own terms.

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